PROJECT SUMMARY Non-alcoholic fatty liver disease (NAFLD) is a common metabolic disorder whose US incidence exceeds 30%. While NAFLD manifests as benign steatosis, in about 15-20% of patients it assumes a much more aggressive form ? non-alcoholic steatohepatitis (NASH). The switch from benign simple steatosis to NASH is poorly understood, but was suggested to depend on ER stress. Indeed, by feeding MUP-uPA mice, which are prone to liver ER stress caused by hepatocyte-specific urokinase plasminogen activator (uPA) expression, a high-fat diet (HFD) we established a faithful model of NASH that readily progresses to hepatocellular carcinoma (HCC). HFD-fed MUP-uPA mice show ER-stress-dependent and persistent activation of sterol response element binding proteins (SREBP) 1 and 2, which control de novo lipogenesis (DNL) and cholesterol biosynthesis. Notably, SREBP1 and 2 remain activated in the MUP-uPA liver without any sign of feedback inhibition, which shuts down their activity in lipid-loaded cells. DNL is also chronically elevated in NAFLD and hepatic accumulation of free cholesterol was suggested to convert simple steatosis to NASH. Investigating how liver ER stress causes persistent SREBP activation, we uncovered a previously unknown pathway in which caspase-2 (Casp2), whose expression is ER-stress-inducible, leads to constitutive activation of site 1 protease (S1P), thereby initiating SCAP-independent SREBP cleavage in the ER. Casp2-mediated cleavage and activation of S1P seems to occur in NASH patients and genetic ablation or pharmacological inhibition of Casp2 in MUP-uPA mice blocks hepatic steatosis and NASH development. To fully establish the mechanistic aspects of this pathway and its role in hepatic steatosis, we will investigate whether it functions in liver-specific SCAP knockout mice and determine whether liver-specific Casp2 ablation affects peripheral adiposity and improves energy expenditure in addition to preventing HFD-induced hepatic steatosis and its progression to NASH. We will also generate knockin mice that express a Casp2-resistant (C2R) form of S1P and determine whether they are protected from ER- stress induced hepatic steatosis and adipose tissue expansion. As ER-stress-mediated Casp2 activation and S1P cleavage seem to depend on Tp53 activity, which results in induction of the Casp2 activator PIDD, we will examine the role of Tp53 and PIDD in Casp2-dependent S1P cleavage, SREBP1/2 activation, and hepatic steatosis, thereby establishing a key metabolic function for Tp53 outside of cancer. Finally, we will examine the hypothesis that the original function of the Casp2-dependent S1P-SREBP activation pathway was to promote energy storage in the form of liver fat during periods of hypernutrition in preparation for long-term starvation. While clarifying the role of Casp2-mediated SREBP activation in hepatic steatosis and NASH, these studies will shed new light on the poorly understood phenomenon of selective insulin resistance, in which hepatic DNL remains elevated despite diminished insulin signaling.